• by Wendy Davis  @wendyndavis, November 30, 2004

Paid listings provider Overture on Friday quietly settled a trademark infringement lawsuit brought by insurance company Geico, MediaDailyNews has learned. The details of the settlement are confidential, but will not require Overture to change any of its business practices, said an Overture spokeswoman. As of presstime, Geico's case against search engine giant Google was still scheduled to go to trial on Dec. 13.

The Overture settlement occurred about one week after federal district court judge Leonie Brinkema denied a motion by Google asking her to decide the case in its favor based solely on the affidavits and other documents. Instead, she ruled on Nov. 19, a trial was needed to flesh out the factual issues. The trial, expected to last one week, will not involve a jury.

In its lawsuit, Geico accused Google and Overture, a Yahoo! company, of violating the Geico trademark by selling Geico competitors the ability to display links to their Web sites when consumers search for the name "Geico." Brinkema earlier ruled that such practices can violate Geico's trademark, if they lead to consumer confusion.

"When defendants sell the rights to link advertising to plaintiff's trademarks, defendants are using the trademarks in commerce in a way that may imply that defendants have permission from the trademark holder to do so," Brinkema wrote in a prior ruling.

The case, and other similar cases pending in the United States, France, Germany, and Italy, could have dire consequences for Google, which frequently provides sponsored links to ads for companies that compete with the ones users have actually queried about. In a recent report filed with the Securities and Exchange Commission, Google stated that a defeat in court could ultimately lead to "a loss of revenues on a prospective basis." The company also stated that it couldn't estimate the magnitude of the potential loss.

The nonprofit consumer advocacy group Public Citizen weighed in on Google's side by filing friend of the court briefs on the search engine's behalf. The group is concerned about the use of trademark laws to stifle competition--which it views as a danger of a Geico court victory. "There is a continuing interest in protecting the right to advertise to consumers," said Public Citizen attorney Paul Alan Levy. Allowing competing insurance companies to get their links in front of Web surfers who query for Geico can ultimately lead to increased competition and lower prices, Levy said.